Robotic process automation (RPA) software revenue grew 63.1 percent in 2018 to $846 million, making it the fastest-growing segment of the global enterprise software market, according to Gartner.

The research & advisory company has estimated that the RPA software revenue will reach $1.3 billion in 2019.

“The RPA market has grown since our last forecast, driven by digital business demands as organizations look for ‘straight-through’ processing,” said Fabrizio Biscotti, research vice president at Gartner.

The competition is intense among the RPA vendors, with nine of the top 10 vendors changing market share position in 2018, he noted.

The top five RPA vendors – UiPath, Automation Anywhere, Blue Prism, NICE and Pegasystems – controlled 47 percent of the market in 2018. Kofax and NTT-AT, which are ranked sixth and seventh respectively, achieved triple-digit revenue growth last year.

North America continued to dominate the RPA software market, with a 51 percent share in 2018, but its share dropped by 2 percentage points year-over-year.

Western Europe held the No. 2 position, with a 23 percent share. Japan came third, with adoption growth of 124 percent in 2018.

“This shows that RPA software is appealing to organizations across the world, due to its quicker deployment cycle times, compared with other options such as business process management platforms and business process outsourcing,” said Biscotti.

Digital Transformation Initiatives Driving RPA Adoption

As per the report, the biggest adopters of RPA software are banks, insurance companies, telcos and utility companies. These organizations traditionally have many legacy systems and choose RPA solutions to ensure integration functionality.

“The ability to integrate legacy systems is the key driver for RPA projects. By using this technology, organizations can quickly accelerate their digital transformation initiatives, while unlocking the value associated with past technology investments,” said Biscotti.

Top Players to Face Increasing Competitionfrom New Entrants

As predicted by Gartner, the RPA software market may look very different in the next three years.

Large software companies, such as IBM, Microsoft and SAP, are partnering with or acquiring RPA software providers. At the same time, new vendors are seizing the opportunity to adapt traditional RPA capabilities for digital business demands, such as event stream processing and real-time analytics.

“This is an exciting time for RPA vendors. However, the current top players will face increasing competition, as new entrants will continue to enter a market whose fast evolution is blurring the lines distinguishing RPA from other automation technologies, such as optical character recognition and artificial intelligence,” said Biscotti.